Short answer
Generally, yes. CRA says all assignment sales of newly constructed or substantially renovated residential housing are taxable for GST/HST purposes when the agreement is entered into after May 6, 2022.
The buyer’s real concern
An assignor focuses on the assignment profit and original deposit but does not budget for HST, legal fees, builder consent charges or income-tax treatment. The expected proceeds can shrink quickly.
What the official rule or guidance says
CRA’s published assignment guidance confirms the GST/HST treatment effective May 7, 2022 and explains that assignment consideration can include amounts related to the original deposit, subject to the governing rules.
What this protection does not guarantee
GST/HST and income-tax treatment are separate. The rule does not guarantee the builder permits assignment or that an assignee can obtain financing. Only one new-housing rebate can be claimed for a home, and the transaction structure matters.
A practical Ontario example
Illustration only: An assignor receives the original $80,000 deposit plus a $40,000 lift. The parties should not assume HST applies only to the $40,000 or that the assignee can simply claim every rebate through the builder.
What to do now
Have an accountant and lawyer calculate the transaction before listing the assignment. Obtain builder consent and fees in writing. The assignee should arrange mortgage and appraisal review early because financing may be based on the lender’s accepted value and documentation—not the advertised assignment price.
Questions to ask before the deadline
- Which document or delivery date starts the legal deadline?
- What can the builder change, delay, charge or refuse under the agreement?
- Could occupancy fees, adjustments or a lower appraisal create a cash shortfall?
- Will the mortgage approval and rate hold still be valid at final closing?
- Which issue needs a lawyer, accountant, inspector, appraiser or mortgage broker?
Rajiv’s broker perspective
A builder purchase creates two timelines: the legal contract and the future mortgage closing. A cooling-off right or warranty protection cannot replace a financing plan, and today’s pre-approval cannot guarantee the appraisal or income position years later. I would test the future closing conservatively, keep the buyer’s credit and funds traceable, and prepare A, alternative/B and—only where sensible—short-term MIC or private fallback options before the deadline becomes urgent.
Related: Real Estate Centre · Mortgage Knowledge Centre · Updates & Rules Centre
Offer signed—or worried about the future closing?
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